Contract of Sales of Goods

Introduction: Intro. According to Section 4(1) a contract of sale of goods is a contract whereby the seller transfer or agrees to transfer the property in goods to the buyer for a certain price

Explanation: Explanation. A contract of sale can be absolute or conditional. According to Section 4(3) when to right of ownership of the goods is transferred from the seller to the buyer under a contract, the transaction is called a Sale. When the transfer of ownership is to be made at some future date, or is to made on the fulfillment of some condition, the contract is called Agreement to Sell.

Characteristics: Characteristics Buyer & Seller: The person who buys the goods or makes an agreement to buy is called the buyer. & the person who sells goods or makes an agreement to sell is called the seller. Goods:- The subject-matter of the contract of the sale is essential the goods, are moveable property other than actionable claims & money Price:- Goods are always sold for a price. Transfer of ownership:- The transfer of ownership can be at the time of making the contract or it can be at a future date. Diff. b/w Sale & Agreement of sell: Sale: Transfer of property Types of goods Nature of rights Risk of Loss Consequences of breach Right of Re-sale Insolvency of Buyer Insolvency of seller Nature of Contract

Diff. b/w Sale & Agreement of sell Contract of Sale vs. Other Contract: Contract of Sale vs. Other Contract Sale vs. Barter:When goods are exchanged for goods is known as barter deal. A sale implies reimbursement for goods sold in terms of money, so in this case barter deal is not a sale. Sale vs. Gift: - In case of gift, the transfer of ownership does not involve any kind of expense. Sale Vs. Bailment: - The buyer acquires the possession of goods from the seller in return for a consideration in money & becomes the lawful owner of the goods, but in bailment one person is the bailor who give the possession of goods to another for a specific objective, after fulfill the objective the bailee is bound to return the good back to bailor.

Types of Goods: Existing goods:- These are those goods that are owned by seller at the time of making the contract. Specific Goods:- these are those goods which are identified by both parties. Generic Goods:- existing goods that have not been specifically identified by the parties. Future Goods:- goods that are not in possession of the seller at the time of the contract. Contingent Goods:- these are same future goods, the acquisition of which by the seller is dependent on a contingency which may or may not happen.

Destruction of Goods: Effects on destruction of Goods: y y y Perishing of Goods before Formation of Contract Perishing of Goods before Sale but after agreement to Sell Perishing of Future and Contingent Goods

Fixation of Price: Modes of Fixing the Price 1. Parties 2. Agreed Manner 3. Course of Dealings 4. Reasonable price